(Bloomberg) -- Accounting changes that could add 12 billion pounds ($15 billion) to U.K. government borrowing this year were announced on Monday.

The Office for National Statistics said a review of student loans has concluded that the assets should be divided into a portion that will be repaid and one that will have to be written off by the government.

Currently, the loans are classified as government lending. Under the new system, the proportion of the debt that will not be repaid will be treated as government spending, and contribute toward the budget deficit. The ONS aims to incorporate the decision into the government accounts next Autumn.

In October, the Office for Budget Responsibility estimated that public sector net borrowing would rise by around 0.6 percent of GDP a year, or 12 billion pounds in the fiscal year ending March 2019, as a result of new approach. That risks all but wiping out Chancellor of the Exchequer Philip Hammond’s 15 billion pounds of fiscal headroom, designed to protect the public finances in the event of a disruptive Brexit.

However, the change has no impact on the overall level of government debt, the ONS said, as debt is a cash measure, so is unaffected by whether the money being paid out is classified as a loan or spending.

The stock of student debt has risen rapidly in recent years and now stands at around 120 billion pounds in nominal terms, or 6 percent of GDP, with further increases seen over the next two decades.

The Department for Education expects that only around 30 percent of full-time English undergraduates who began their studies in the 2017-18 academic year will fully repay their loans, as payments are only required when a borrower reaches an earnings threshold of 25,000 pounds. Some will either never reach that threshold or spend too little time above it to clear the debt.

To contact the reporter on this story: Andrew Atkinson in London at a.atkinson@bloomberg.net

To contact the editors responsible for this story: Fergal O'Brien at fobrien@bloomberg.net, Lucy Meakin, David Goodman

©2018 Bloomberg L.P.